2. Policy and statutory authority to cost recover the regulatory activity

Government policy authority to recover the cost of regulatory activity

The policy authority to fully recover the cost of activities of industrial chemical regulation was provided for in the 1994 95 Budget under the measure “Implementing full cost recovery in 1996–97 for National Industrial Chemicals Notification and Assessment Scheme”. 

On 26 May 2015, the Australian Government announced its decision to implement a range of reforms to the regulation of industrial chemicals². These reforms were implemented through the establishment of AICIS, which replaced the National Industrial Chemicals Notification and Assessment Scheme (NICNAS) on 1 July 2020. 

The establishment of AICIS did not change the Government’s policy position that the full cost of regulatory activities be recovered through fees and charges paid by regulated entities (introducers of industrial chemicals). Full cost recovery continues to be applied and is considered appropriate because introducers continue to create the need for industrial chemicals in the marketplace to be regulated. 

Refer to Section 3 for further details.

Statutory authority to charge

Fees for services are specified in Ministerial rules made under the:

• Industrial Chemicals Act 2019

Charges are specified in regulations made under the:

• Industrial Chemicals Charges (Customs) Act 2019
• Industrial Chemicals Charges (Excise) Act 2019
• Industrial Chemicals Charges (General) Act 2019

The three charges Acts provide the statutory basis for the registration charge to be based on annual introduction value. As AICIS regulates both the importation and manufacture of industrial chemicals, the registration charge could be legally characterised not only as a tax but also as a duty of customs or a duty of excise requiring three separate acts.